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0 pointsmceoin7y ago0 comments

Difficult to prove impact but during 08 global recession the Australian (Labor) Govt gave everybody money with the directive “to spend it”. Also pumped money into system through govt projects and rebates (schools building, solar rebates, etc).

On the other hand, Australia was also exporting coal and iron ore to insatiable (at the time) India and China. We also didn’t have the same real estate bubble (at the time).

Hard to prove either way, but Aus did move first and injected a lot of capital into the system, we didn’t enter a recession (unlike rest of OECD), and we didn’t end up having to bail out banks.

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3 comments · 1 top-level

madskillsmonk7y ago· 2 in thread

Everyone used the money handed out to buy property, and now your real estate prices have gone up an enormous amount, to the point where it's been pointed out as one of the biggest property bubbles, and young people will have an incredibly hard time affording a home.

jddj7y ago

This seems pretty unlikely. The handout mentioned was a one-off 900 Australian dollars per individual earning less than $AU100k, and a one-off "back to school" bonus per school-aged child.

900 dollars, or even $2100 for a small family isn't the sort of cash that would inflate an auction for a home anywhere, let alone in one of the australian cities affected by the current bubble.

analyst747y ago

Those 900 dollars don't just stay in everybody's bank account, they get spent, and start circulating the system and eventually consolidated into fewer hands, who in turn buys properties or other assets.

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